Latest news with #AllPakistanTextileMillsAssociation
Business Recorder
4 days ago
- Business
- Business Recorder
Chinese CG, APTMA leaders discuss trade ties
LAHORE: Chinese Consulate General and All Pakistan Textile Mills Association (APTMA) leadership have resolved to upsurge bilateral trade, take maximum advantage of Free Trade Agreement (FTA) and to explore possibilities of joint ventures in textile industry. Zhao Shiren Consul General of China, Li Haoteng, Commercial Counsellor and Wang Yaqiang, Vice Consul visited APTMA office on Tuesday and discussed in detail prospects, ways and means to increase volume of trade and joint ventures in textile industry. Dr Gohar Ejaz, Patron-in-Chief APTMA and Chairman APTMA Kamran Arshad welcomed the Chinese Consul General at APTMA. They were accompanied by Syed Ali Ahsan, former Chairman APTMA, Zonal Management Committee members including Haroon Ellahi, Muhammad Ali, Faisal Jawed, Ahsan Shahid, Ismail Fareed, Habib Anwar, leading textile exporters, Secretary General APTMA Shahid Sattar and Secretary General North Mohammad Raza Baqir. Speaking on the occasion, Zhao Shiren said both China and Pakistan enjoy strong economic and cultural relations and China Pakistan Economic Corridor (CPEC) is an example of this robust relationship between both the countries. He highly appreciated the role of APTMA in general and of Dr Gohar Ejaz in particular in expansion of bilateral economic relations. He enumerated highly plausible services rendered by Dr Gohar Ejaz in cementing relation between China and Pakistan not only as Commerce Minister but also in his private capacity. He also spoke volume about community and welfare services being performed by Gohar Ejaz Foundation for poverty alleviation, medical services, educational and research uplift and industrialization of the country. Consul General highlighted expansion of bilateral trade since the signing of China-Pakistan Free Trade Agreement (FTA) in 2006 and resolved to further uplift the said volume by taking maximum benefits from FTA. He noted that balance of trade is presently in favour of China and assured of his help to not only expand trade volume but also to bridge the gap in balance of trade. He informed that textile goods falling in more than 800 HS tariff lines of customs chapters 50 to 63 enjoy duty free status under FTA on import into China from Pakistan. He emphasised Pakistani textile industry to avail duty free regime widely liberalized for Pakistani textile products since implementation of Phase II of FTA in 2020. Copyright Business Recorder, 2025
Business Recorder
6 days ago
- Business
- Business Recorder
Weekly Cotton Review: Market shows signs of stability
KARACHI: The cotton market has shown signs of stability, with business activity also picking up. The spot rate has increased by Rs 300 per maund, marking a positive trend for traders and growers. Several ginning factories in Sindh and Punjab have partially resumed operations, while approximately 20,000 to 25,000 bales of phutti (seed cotton) have already arrived at ginning facilities. However, the textile and cotton ginning sectors are facing pressure due to recent budget measures. The continuation of sales tax on cotton, phutti, and other by-products, along with the decision to keep imported cotton tax-free, has negatively impacted the industry. Ehsan ul Haq, Chairman of the Cotton Ginners Forum, stated that these policies are having adverse effects. Abid Zaidi reported that authorities are closely monitoring the cotton crop situation in Pakistan. Agricultural experts from the CCRI Multan have issued recommendations for cotton growers, valid until June 30. Sajid Mahmood explained that the guidelines provide detailed instructions on crop maintenance and strategies to address potential challenges. During the past week, the local cotton market witnessed overall price stability with relatively better trading activity. In Sindh province, cotton prices ranged between Rs 16,300 to Rs 16,700 per maund, while in Punjab, prices stood at Rs 16,800 to Rs 17,200 per maund. Meanwhile, phutti (seed cotton) was traded at Rs 7,700 to Rs 8,500 per 40 kg in Sindh and Rs 8,000 to Rs 8,800 per 40 kg in Punjab. Currently, two to three ginning factories are operational in both Sindh and Punjab, leading to increased cotton trading. Several mills are actively purchasing new cotton, while the arrival of phutti has also been gradually rising. In the recent budget, the government eliminated the Export Facilitation Scheme (EFS) for the textile and ginning sectors on the import of cotton and fabric. However, ginners had hoped for the removal of multiple taxes imposed on them, but the budget only introduced an 18% sales tax on yarn imports. While the All Pakistan Textile Mills Association (APTMA) has appreciated some measures, ginners expressed significant disappointment as most existing taxes on them remain unchanged. The negative impact of these taxes is expected to extend to cotton growers, who have also expressed dissatisfaction with the budget decisions. The EFS facility for importing cotton and fabric is currently available, which is expected to negatively affect the local cotton industry. Since an 18% sales tax is imposed on local cotton, the market will struggle to gain momentum, directly impacting cotton farmers. If cotton prices decline, the rates for cottonseed (phutti) will also drop. Additionally, with high input costs for cotton growers, there are concerns that cotton cultivation may decrease this season. This year, major mill groups have already signed large-scale import contracts for cotton, leading to relatively lower purchases of local cotton. As a result, ginners and cotton farmers will see reduced demand for both phutti and raw cotton, and prices are expected to remain unfavourable. The situation may further discourage cotton production in the coming season. In Sindh, the price of cotton per maund ranged between Rs16,300 and Rs16,700, while phutti (seed cotton) for 40 kg was sold at Rs7,700 to Rs8,500. Meanwhile, in Punjab, cotton per maund was traded at Rs16,800 to Rs17,200, with phutti (40 kg) priced between Rs8,000 and Rs8,800. The Spot Rate Committee of the Karachi Cotton Association increased the spot rate by Rs300 per maund, closing the spot rate at Rs16,500. Naseem Usman, Chairman of the Karachi Cotton Brokers Forum, reported that international cotton prices remained weak. The future price of New York cotton closed at 64.10 to 67.00 American cents per pound. The cotton ginning and oil mills sector is facing growing concerns following the federal budget's failure to eliminate sales tax on cotton and its by-products. Industry leaders fear that more ginning factories and oil mills may shut down, leading to a surge in undocumented trade. Business communities are urging Prime Minister Shehbaz Sharif to allocate the substantial annual funds of over Rs. 700 billion from the Benazir Income Support Program towards reviving struggling industries instead of charity. They argue that boosting businesses will strengthen the national economy. Ehsan ul Haq, Chairman of the Cotton Ginners Forum, revealed that despite recommendations from a committee formed on Prime Minister Shehbaz Sharif's directive—supporting textile mill owners' demands to either abolish the Export Facilitation Scheme (EFS) or implement it domestically—the budget retained sales tax on cotton, cottonseed, oilcake, and cottonseed oil. Additionally, no sales tax was imposed on imported cotton, further destabilizing the sector. Haq warned that over 800 already inactive ginning factories and 1,000 oil mills could be joined by more closures. He highlighted that Pakistan, once the world's fourth-largest cotton producer, has now fallen to seventh place due to excessive sales taxes (over 70%) on ginning and oil industries, non-implementation of crop zoning laws, and unchecked sugarcane cultivation. A significant portion of Pakistan's foreign exchange reserves is now spent on importing cotton, yarn, and edible oil. Instead of reviving distressed industries or reducing taxes, a major chunk of national resources (over Rs. 700 billion) is being diverted toward charity or misused under its guise. Haq appealed to PM Shehbaz Sharif to redirect these funds toward industrial revival to bolster the economy. Expectations were high that ginning factories in Punjab and Sindh would resume operations after Eid-ul-Adha holidays. However, due to the unchanged tax policies, only a limited number have restarted despite increased cotton arrivals in several cities. This has led to declining prices for cotton and Phutti, directly hurting farmers and weakening the economy. Experts also warn of a potential record rise in undocumented trade as a result. Abid Zaidi said that at present, only a few ginning factories are operational in Sindh and Punjab, ( number is increasing day by day )working at a slow pace due to limited arrivals at the start of the season. The growers, ginners and the textile industry had placed high hopes on the federal budget, anticipating supportive measures from the government. However, no tax relief was granted. As a result, market sentiment turned negative, and lint prices sharply declined by Rs. 1,000 per maund from Rs. 17,500 to Rs. 16,500 in a single day. Adding to this pressure, global cotton prices are also weak, further dampening the domestic market. The combination of high input costs and falling cotton prices has deeply disappointed growers, who were already facing hardship due to low wheat prices earlier in the year. Current government policies appear to favour imports, placing further strain on local farmers. Without a level playing field, the survival of growers, ginners, and even the textile industry is in serious jeopardy under the prevailing tax regime and the cotton demand is likely to drop about one million bales this year. Cotton sowing is already lagging significantly behind targets, and if the current tariff structure continues, farmers will be further discouraged from planting cotton. As a result, Pakistan's cotton production is expected to fall short of projections. In addition, rising temperatures and a growing whitefly infestation are likely to further damage the crop. Hardly 400 ginning factories are likely to be operational this season and the rest will take rest. We may have even lower production compared to last season. In its recent meeting, the Farmers Advisory Committee at the Central Cotton Research Institute (CCRI), Multan, issued detailed agronomic recommendations for cotton growers, effective through June 30. Cotton experts highlighted increasing pest pressures in cotton-growing regions, particularly from whitefly, jassid, thrips, and other insect pests. Growers were strongly advised to conduct regular pest scouting and apply pesticides only when pest populations reach economic threshold levels, and in consultation with cotton experts. Head Transfer of Technology CCRI Multan Sajid Mahmood said for jassid control, when the population reaches one nymph or adult per leaf, farmers should apply Dinotefuron at 100 grams or Flonicamid at 60 grams per 100 litres of water per acre. These insecticides are also effective against aphids. In the case of thrips, where 8–10 nymphs or adults per leaf are observed, Spinetoram at 60 ml or a mixture of Abamectin + Thiamethoxam at 500 ml per 100 litres of water per acre is recommended—particularly if mite infestation is also present. Experts recommended delaying the initial pesticide application as long as possible. For whitefly management, the use of at least 10 yellow sticky traps per acre is advised. If the population exceeds five nymphs or adults per leaf, chemical control using Flonicamid (80 grams), a mixture of Centrinili Prol + Dinotefuran (300 ml), or Pyriproxyfen (400–500 ml) per 100 litres of water per acre should be adopted. In fields where boll formation has commenced, pink bollworm infestation has been reported. Farmers should install one pheromone trap for monitoring and eight traps per acre for active management. For termite control, a combined application of Chlorpyrifos (1000 ml) and Fipronil (480 ml) through flood irrigation using a single nozzle is advised. For fields in the flowering or boll development stage, consistent and adequate irrigation is essential. Thinning should be completed within 25 days under moist soil conditions, and all weak or diseased plants should be removed. Effective weed management through timely irrigation and mechanical control—particularly in the first 60 days—is crucial, as unchecked weed growth can result in up to 40% yield loss. The use of high-tine cultivators (riggers) is recommended once the crop is six weeks old. Additionally, in glyphosate-tolerant varieties, glyphosate may be applied at 800–1000 ml per 100 litres of water per acre to manage weeds. For cotton sown in March–April for seed purposes, rouging—removal of unwanted, off-type, or diseased plants—should be completed before boll formation. In cases where fruit shedding symptoms are observed, a foliar spray of zinc sulphate (250 grams), borax (150 grams), and magnesium sulphate (300 grams) in 100 litres of water per acre is recommended. To enhance nutrient uptake, a separate solution of 2 kg of urea should be added to the spray mix, and the application repeated after 15 days. Furthermore, once the crop reaches 45 days of age, a post-irrigation application of one bag of urea along with 5–6 kg of zinc sulphate is recommended to support optimal growth and productivity. These guidelines have been developed by CCRI's cotton experts to help cotton growers safeguard crop health and maximize yields during the critical mid-season growth phase. Copyright Business Recorder, 2025
Business Recorder
12-06-2025
- Business
- Business Recorder
APTMA, US CG discuss ways to foster bilateral trade
LAHORE: Kristin K Hawkins, United States Consul General in Lahore, and All Pakistan Textile Mills Association (APTMA) office-bearers discussed ways to foster bilateral trade and economic relations between Pakistan and the United States of America. Kamran Arshad, Chairman APTMA, Asad Shafi, Chairman North, Ahmad Shafi, Vice Chairman, Mohammad Qasim, Treasurer, Haroon Ellahi, senior Executive, former Chairman Ali Ahsan, and Secretary General Raza Baqir along with senior members of APTMA representing leading textile groups welcomed Kristin Hawkins, William Campbell, Economic Chief and Amna Anis Economic Specialist. They discussed the enormous potential to work together in the field of cotton and textile besides expanding trade and investment relations in other focused areas reducing trade deficit and diversifying major commodities of trade between both countries in the wake of US reciprocal tariffs. Both sides were of the view that Pakistan has strong potential to grow in textile and other sectors. APTMA leadership continued to focus on engagements and dialogue with their American counterparts to uplift trade volume and to gain maximum benefit of economic partnership between both the countries. Speaking on the occasion, Kamran Arshad made a detailed presentation on textile industry of Pakistan. He pointed out that Pakistan's domestic cotton production has declined over the years and even this year huge quantity of cotton would be required to be imported due to poor cotton crop. He said the major supplier of cotton to Pakistan is the USA. Pakistan is the largest importer of US cotton in the world. He added that the import of US cotton compensate loss in production of local cotton. According to Kamran, the availability of cotton and other inputs is essential for economy of the country as textile constitutes 62% of total exports from Pakistan. Kamran Arshad highlighted issues being faced by textile industry including withdrawal of Regionally Competitive Energy Tariff for both electricity and gas. He specifically mentioned discriminatory tax treatment for local supplies and import of inputs under Export Facilitation Scheme (EFS) which allows tax-free import of raw materials but levies sales tax @ 18% on procurement of locally produced goods. This discrimination has forced closure of 120 spinning mills and more than 800 ginning factories, increasing import of yarn from $340 million last year to $800 million this year. Kamran emphasised for restoration of even playing field both for imports and local supplies under EFS to ensure continuous operations of textile industry as any shut down of textile sector would render millions as jobless, creating catastrophic situation endangering survival of the country. He stressed on evolving a mechanism to import US cotton under GSM-102 against export of textile products to the US. He added that proceeds of Pakistan textile export to the US may be used as collateral through the mechanism of an escrow account whereby this liability is deducted from the export proceeds of Pakistan textile import into the US. Speaking about the strength of the textile industry in Pakistan and further expansion of bilateral trade between the US and Pakistan, Asad Shafi, Chairman North said that the US is Pakistan's largest trading partner with a total bilateral trade of $9.85 billion in 2024. According to him, total exports of Pakistan to the US stood at $5.12 billion out of which $3.93 billion or 77% were textile and apparel. As against this, Pakistan imported $2.14 billion goods from the US in 2024 of which cotton imports were more than $700 million. Asad stressed upon promotion of US cotton linkages with Pakistan textile industry, as well as, promotion of toll manufacturing in Pakistan by US textile industry. He said there is a need for technology transfer to Pakistan for high yielding cotton seed and synergies with US cotton research institutes for better quality. He also sought capacity building of agricultural research institutions in Pakistan and technology transfer for cotton traceability. Asad said that the United States should facilitate entry of international seed companies with transgenic technologies besides introduction of improved, genetically modified, and certified seed. He also spoke on the importance of establishing joint ventures between Pakistan and US investors. Meanwhile, speaker of the Punjab Assembly, Malik Muhammad Ahmad Khan, met with the United States Chargé d'Affaires, Natalie A. Baker, and US Consul General Kristin Hawkins, at the Punjab Assembly. The Speaker warmly welcomed the distinguished guests and termed their visit to the Assembly as a positive step towards strengthening institutional ties. On this occasion, Malik Muhammad Ahmad appreciated Natalie Baker's constructive and dynamic role in Pakistan, stating that Pakistan–US relations are based on mutual trust and a valued strategic partnership. He emphasized that the United States' proactive and constructive role in ensuring peace in South Asia is of utmost importance. The meeting included detailed discussions on Pakistan–US relations, regional peace, climate change, food security, educational collaboration, and cooperation in other vital sectors. The Speaker expressed a desire to further deepen ties between Punjab and the US state of California, noting that the Pakistani-American community continues to serve as a robust bridge between the two nations. He further remarked that Pakistan views the United States as a key global partner in addressing climate change, development, and food security, and wishes to expand this strategic cooperation even further. Natalie Baker affirmed that the United States aims to further strengthen diplomatic engagement with Pakistan and will continue to support democratic institutions and parliamentary exchanges. Kristin Hawkins expressed her intent to enhance collaboration in the fields of education and social development. The meeting was also attended by Member Provincial Assembly Iftikhar Chachar, Secretary General of the Punjab Assembly Chaudhry Amer Habib, Principal Secretary to the Speaker Imad Hussain Bhalli, and Malik Taimoor Ahmad Khan. Copyright Business Recorder, 2025
Business Recorder
12-06-2025
- Business
- Business Recorder
Imported cotton yarn: APTMA hails 18pc sales tax imposition
ISLAMABAD: The All Pakistan Textile Mills Association (APTMA) has appreciated imposing 18 percent sales tax on imported cotton yarn by the government. According to the Association, the budget addressed a major distortion in the market and is a significant step toward resolving the sales tax anomaly in the Export Facilitation Scheme (EFS). It demonstrates the government's commitment to restoring fairness and balance in the domestic textile value chain, and commended this decisive action. However, this correction—while welcomed—is insufficient in scope. After having dealt a severe blow to the spinning sector, the sales tax disparity is now eroding the viability of downstream sectors like weaving. EFS, under which imported inputs for export enjoy a zero percent sales tax rate while local materials for export are taxed at 18 percent, continues to place upstream domestic sectors at a gross disadvantage. Local cotton: Pakistan govt working to abolish 18% GST, says minister Chairman APTMA, Kamran Arshad, in a statement stated that to ensure true competitiveness and sustainability of Pakistan's textile value chain, APTMA strongly urges the government to extend the 18 percent sales tax to all yarns and fabrics, whether cotton or polyester, imported under EFS. Moreover, these imports must be placed on the EFS Negative List, imposing a 5 percent customs duty on yarn and 11 percent on fabric to establish a level playing field and incentivize local manufacturing. Without this, the gains made in one segment will be undone by distortions in another. He said the situation with poly-cotton and polyester yarns is particularly concerning, as they are already approximately 35 percent more expensive to produce domestically. Subjecting local manufacturers to 18 percent sales tax while exempting imported polyester inputs undermines industrial policy objectives and discourages investment in local capacity. APTMA also reiterated its demand for the removal of sales tax on cottonseed and cottonseed cake —by-products of cotton lint- used primarily in livestock feed. These items are not subject to sales tax in any major cotton-producing economy. Imposing 18 percent GST on these products pushes farmers below their cost of production, especially given the price inelasticity of demand, and drives a damaging shift toward more water-intensive crops. This not only imperils water security but also fuels underreporting of cotton production, thereby reducing revenue collection on cotton lint itself. 'We are grateful for the government's attention and responsiveness to industry concerns thus far. However, without extending similar GST treatment to all EFS imports of yarns and fabrics, the crisis faced by spinning will soon replicate in weaving. Yarn feeds into fabric production, and if locally produced fabric is taxed while imported fabric is not, exporters will inevitably choose the cheaper, untaxed import—undermining both the fabric and yarn sectors,' he added. APTMA has urged the government to adopt a comprehensive, value-chain-wide perspective. Partial reforms are insufficient. The core anomaly remains: imported inputs for export are exempted while local inputs are taxed. This policy penalizes domestic value addition, stifles backward linkages, and impedes the very foundation of an export-led growth strategy. Efforts to integrate into global value chains should continue, but not at the expense of domestic industry, employment, and investment. 'APTMA deeply appreciates the government's broader economic reform agenda, which has yielded substantial relief and renewed confidence across the industrial landscape. The reduction in power tariffs from an unsustainable 16–17 cents/kWh to approximately 11 cents/kWh, the successful curbing of back-breaking inflation, and the lowering of interest rates from 22 percent to 11 percent are commendable achievements,' Arshad continued. The Association further stated that these efforts have laid the groundwork for economic stabilization and set the stage for sustainable recovery. To translate this momentum into broad-based industrial growth and export expansion, it is imperative that remaining issues—such as the EFS-related tax anomalies—are addressed comprehensively. With these distortions resolved, the textile value chain can regain its full competitiveness, unlocking investment, job creation, and foreign exchange earnings for Pakistan. Copyright Business Recorder, 2025
Business Recorder
02-06-2025
- Business
- Business Recorder
Weekly Cotton Review: Prices steady, trading activity subdued
KARACHI: The cotton market is showing stability in prices, though trading activity remains subdued. New crop deals for the 2025-26 seasons are being finalized between Rs. 17,200 to Rs. 17,500 per maund, while phutti (seed cotton) is trading at Rs. 8,000 to Rs. 8,500 per 40 kg. According to industry sources, approximately 2,200 bales of the new crop have already arrived at ginning factories across the country. Currently, three ginning factories in Sindh and four in Punjab are partially operational. Market participants anticipate a significant uptick in trading after Eid-ul-Adha. Punjab's Secretary of Agriculture, Iftikhar Ali Soho, reported that the province has achieved 94% of its cotton cultivation target for the current season. Meanwhile, the textile industry has renewed its demand for the abolition of the Export Facilitation Scheme (EFS) and the removal of the 18% sales tax on locally produced cotton. Additionally, calls for eliminating the General Sales Tax (GST) persist, with expectations that the issue may be addressed in the upcoming budget. The Pakistan Cotton Ginners Association (PCGA) and the All Pakistan Textile Mills Association (APTMA) have jointly urged the government to scrap the EFS and abolish the 18% sales tax on domestic cotton. Chairman of the Cotton Ginners Forum (CGF), Ihsan-ul-Haq, warned that the entire cotton sector is grappling with the worst economic crisis in the country's history, stressing the need for immediate policy interventions to revive the industry. During the past week, the local cotton market saw stable prices for cotton. Trading remained limited as the partial arrival of the new cotton crop has begun. Currently, three ginning factories in Sindh province are partially operational, while four ginning factories in Punjab province have also partially started ginning. Partial arrival of phutti (seed cotton) from the lower regions of Sindh has commenced, with approximately 2,200 bales of phutti having reached ginning factories so far. Increased trading activity is expected after Eid-ul-Adha. The government has set a production target of one crore eighteen lakh bales for the new 2025-26 season. Currently, trading in the ongoing season is slow, with cotton prices ranging between 15,000 to 17,500 rupees per maund. Most transactions are being conducted on credit, with deals based on quality and payment conditions. The stock of cotton with ginners is gradually decreasing. Federal Minister for Trade Jam Kamal Khan has stated that the government is seriously working to eliminate the 18% general sales tax on local cotton in order to boost cotton production. He shared this during a press conference on Monday. The PHMA (Pakistan Hosiery Manufacturers Association) has urged the government to reduce electricity tariffs during peak hours to promote exports. In Sindh and Punjab provinces, cotton trading took place between 15,000 to 17,500 rupees per maund, depending on quality and payment conditions. New crop transactions were recorded at 17,000 to 17,500 rupees per maund, while phutti (seed cotton) was sold at 8,000 to 8,800 rupees per 40 kg. The Karachi Cotton Association's Spot Rate Committee maintained the spot rate stable at 16,700 rupees per maund. Naseem Usman, Chairman of the Karachi Cotton Brokers Forum, said that international cotton prices are experiencing fluctuations. New York cotton prices showed a mixed trend, with futures trading between 65.50 to 69 cents. According to the USDA's weekly export and sales report, 118,700 bales were sold for the year 2024-25. Vietnam remained at the top by purchasing 65,600 bales. Bangladesh secured the second position by buying 17,300 bales, while Turkey ranked third with 12,400 bales. For the year 2025-26, 13,800 bales were sold. Pakistan led the purchases with 7,600 bales, followed by Thailand in second place with 3,500 bales, and Peru in third place with 2,600 bales. Meanwhile, Punjab Agriculture Secretary Iftikhar Ali Sahu has informed the Business Club that cotton cultivation has been completed on over 33 lakh acres in Punjab, and the province has achieved 94% of the set target. He stated this while presiding over a high-level review meeting on the current situation of cotton. Punjab Agriculture Secretary Iftikhar Ali Sahu said that a unique and successful tradition has been established to improve cotton production through phased cultivation. Pakistan's cotton sector is facing its gravest financial crisis in decades, prompting swift government attention after urgent appeals from the Pakistan Cotton Ginners Association (PCGA) and the All Pakistan Textile Mills Association (Aptma). Both associations have launched a high-profile lobbying campaign, writing to Prime Minister Shehbaz Sharif and initiating a nationwide media blitz, demanding the immediate abolition of the Export Facilitation Scheme (EFS) or the removal of sales tax on domestically produced cotton and its by-products. The premier subsequently sought policy recommendations from the Ministry of National Food Security and Research (MNFSR). In response, the ministry has formally endorsed the industry's proposals. In a letter to PCGA President Dr Jassu Mal, Cotton Commissioner Dr Khadim Hussain stated that the government has recommended that the 18pc sales tax on domestic cotton, cottonseed, oilcake, and cottonseed oil be lifted immediately, or that imports of cotton, yarn, and grey cloth be taxed at the same rate. The ministry's recommendations, forwarded to safeguard farmers' incomes, revive local production, and stem Pakistan's soaring dependence on costly cotton imports, it says. The communiqué notes that Punjab has implemented targeted subsidies for farmers to increase their incomes and reduce production costs for various crops. Industry data reveals that textile mills have imported over 300 million kgs of cotton yarn and two million bales of cotton during the first nine months of 2024-25, draining billions of dollars in foreign exchange. Despite this, domestic production has fallen to a historic low of just 5.5m bales. Meanwhile, more than 200,000 bales of unsold cotton and vast stocks of yarn remain idle in factories, with demand at a standstill. Cotton Ginners Forum Chairman Ihsanul Haq says the fallout has been devastating as over 800 ginning units and 120 spinning mills have ceased to function, while hundreds more textile units are barely functioning. 'If the current policy persists, the sector risks total collapse,' he warns, adding that Pakistan may soon be forced to import not only cotton but also edible oil, compounding the country's financial woes. The MNFSR's recommendations underscore the urgency, recommending immediate tax relief for domestic producers or the imposition of equal taxes on imports to restore a level playing field. All eyes are now on the federal government, as the fate of Pakistan's cotton and textile industry hangs in the balance. Copyright Business Recorder, 2025
